Wonkbook: Feds to run 26 Obamacare exchanges

February 19, 2013

Welcome to Wonkbook, Ezra Klein and Evan Soltas's morning policy news primer. To subscribe by e-mail, click here. Send comments, criticism, or ideas to Wonkbook at Gmail dot com. To read more by Ezra and his team, go to Wonkblog.

Wonkbook's Number of the Day: 26. That's the number of Obamacare exchanges the federal government will be running. And that means the federal government, not the states, will be running most of the exchanges. 


(REUTERS/Jessica Rinaldi)

Wonkblog's Graph of the Day: The CBO has a cool new infographic on federal means-tested programs.

Wonkbook's Top 5 Stories: 1) Obamacare comes clearer; 2) what Krueger has to say about the economy; 3) other countries want our immigrants; 4) the political opening for gun control; and 5) the Keystone pipeline fight.

1) Top story: Obamacare, and what's next for health policy

It's official: the Feds will run most of the Obamacare exchanges. "Friday was a very important day for health policy days. It was the last day for states to tell the federal government whether they wanted any part in running the Affordable Care Act  health exchanges come 2014. The federal government did not get many takers." Sarah Kliff in The Washington Post.

The details of the dental plans in ACA are emerging. "Rules on pediatric dental plans and many other aspects of the Affordable Care Act are due as soon as this week...Pediatric dental coverage is among 10 benefits—including prescription drugs, mental-health services and physical rehabilitation—that insurance plans on the exchanges must include." Jennifer Corbett Dooren in The Wall Street Journal.

Big tobacco and anti-cancer advocates agree that ACA provision goes too far. "Big tobacco companies and anti-cancer activists are standing in opposition to a part of the Affordable Care Act that allows insurance companies to charge smokers 50 percent more than patients who do not use tobacco. Cigarette makers such as Altria say the policy amounts to discrimination against smokers. The American Cancer Society, meanwhile, worries that the high surcharges could make health insurance unaffordable to cigarette smokers, who are disproportionately low income." Sarah Kliff in The Washington Post.

Meanwhile, government is pushing two high-profile medical research initiatives. The first: "The idea of sharing medical data from patients with rare diseases is gaining backing from public-health officials at the National Institutes of Health and the Food and Drug Administration. If companies, hospitals and researchers don't have to cover the full cost of such studies, there might be more efforts to develop treatments for rare diseases, these officials say." Amy Docser Marcus in The Wall Street Journal.

...And the second: "Scientists likened the Brain Activity Map effort to the Human Genome Project, the government-led initiative that helped decipher the human genetic code and provided a huge boost for the genetics industry. The idea 'is to organize a national effort to crack the problem' of how the brain functions at its deepest levels, and how various neurological ailments might be better treated." Gautam Naik and Colleen McCain Nelson in The Wall Street Journal.

KLEIN: Paying for our retirements and elderly health care. "[There's] a future in which taxes need to be much higher but health-care spending doesn’t need to be much lower. As a general point, the real problem with health-care spending isn’t how much we’re spending but how little we’re getting. If sticking on our current budget trajectory could make us live twice as long, there’d be a very good argument for simply doing that." Ezra Klein in The Washington Post.

CHRISTENSEN, FLIER, AND VIJAYARAGHAVAN: The coming failure of 'accountable care.' "The ACO concept is based on assumptions about personal and economic behavior—by doctors, patients and others—that aren't realistic...The first untenable assumption is that ACOs can be successful without major changes in doctors' behavior." Clayton Christensen, Jeffrey Flier, and Vineeta Vijayaraghavan in The Wall Street Journal.

Music recommendations interlude: The National, "Mistaken for Strangers," 2010.

Top op-eds

RUHS AND MARTIN: The U.S. should let the U.K.'s immigration policy immigrate. "The British experience with the Migration Advisory Committee shows that, if firmly based on transparent analysis, an independent commission can play a critical role in linking the admission of guest workers to an assessment of the needs of the domestic labour market – in a way that works both for employers and unions." Martin Ruhs and Philip Martin in The Financial Times.

ROBINSON: It's beginning to look a lot like...immigration reform. "The outlines of a solution are obvious. There would be a clear path to citizenship for those who were brought here as children. There would be provisional legal status, and a route to permanent legal status, for those who came as adults. There would be measures to tighten security along the border with Mexico. There would probably be some kind of guest-worker program for those who seek only to come for seasonal employment. And there would be changes to streamline the legal immigration system, especially for high-tech workers and potential entrepreneurs." Eugene Robinson in The Washington Post.

PONNURU: A balanced-budget amendment is a bad idea. "The economic argument assumes the amendment would be enforced. It isn’t clear how it would be. If the government were projected to run a deficit, would the courts step in to cut spending or raise taxes? The senators’ amendment rules out judicial tax increases but leaves the door open for court- ordered cuts in defense spending or Social Security benefits. The result would be a major expansion of judicial power over American life, brought to us by the party that has rightly warned against the growth of that very power for decades." Ramesh Ponnuru in Bloomberg.

FOLBRE: Preschool economics. "Even a 4-year-old can understand the case for early-childhood education. It’s fun, you learn things, you make it easier for Mom and Dad to earn a decent living, and when you grow up you will be better able to earn a decent living yourself. At that point, you will start paying taxes that return the favor, helping finance the retirement and health care of the generation that invested in your education." Nancy Folbre in The New York Times.

LANE: Resolving the minimum-wage debate. "Is there no more efficient, better-targeted alternative? Yes: increasing the earned-income tax credit, a cash supplement to wages that works like a negative income tax...Krugman and others object that employers capture some of the credit, because it enables workers to work for less and firms to pay them accordingly. This strikes me as a feature, not a bug...[I]t’s appropriate to purchase them through a transparent tax-code subsidy that falls on the public as a whole." Charles Lane in The Washington Post.

BROOKS: What data can't do. "Big data has trouble with big problems. If you are trying to figure out which e-mail produces the most campaign contributions, you can do a randomized control experiment. But let’s say you are trying to stimulate an economy in a recession. You don’t have an alternate society to use as a control group. For example, we’ve had huge debates over the best economic stimulus, with mountains of data, and as far as I know not a single major player in this debate has been persuaded by data to switch sides." David Brooks in The New York Times.

NOCERA: Misguided environmentalism. "Can environmental groups expect to win a series of fights for decades to come, when the economic forces are aligned very strongly against them in each round? The answer is obvious: no. The emphasis should be on demand, not supply. If the U.S. stopped consuming so much of the world’s oil, the economic need for the tar sands would evaporate." Joe Nocera in The New York Times.

Wow videos interlude: The tragic story of Lake Peigneur, LA.

2) Krueger's take on the economy

Economy going through 'a lot of healing,' says Alan Krueger. "Consumer spending could remain modest as the economy recovers from the recession, even with steady improvement in the housing market, the White House's top economist said...He said the U.S. needs to invest more in research and development, to boost innovation, and also encourage start-up businesses, which could be one benefit from an overhaul of immigration policies." Sudeep Reddy in The Wall Street Journal.

Why aren't more countries run by economists? "Mark Hallerberg and Joachim Wehner have an interesting new paper trying to figure out “why governments sometimes appoint economic policymakers with economics training but often do not.” By studying the qualifications of more than 1,200 prime ministers, presidents, finance ministers, and central bankers in various democracies since the 1970s, they uncovered a few key patterns." Brad Plumer in The Washington Post.

The Fed is reconsidering its exit strategy from monetary stimulus. "US Federal Reserve officials fear a backlash from paying billions of dollars to commercial banks when the time comes to raise interest rates. The growth of the Fed’s balance sheet means it could pay $50bn-$75bn a year in interest on bank reserves at the same time as it makes losses and has to stop sending money to the Treasury." Robin Harding and Tom Braithwaite in The Financial Times.

...And the SEC has a lot of work to do. "A proposal to force public companies for the first time to disclose all their political activity to investors is emerging as an early litmus test for Mary Jo White, Barack Obama’s nominee to head the Securities and Exchange Commission." Stephanie Kirchgaessner and Dan McCrum in The Financial Times.

Legal interlude: The etymological backstory for "shouting fire in a crowded theater."

3) Other countries are getting our rejected immigrants

Other countries want the immigrants the U.S. is turning down. "While other countries are actively recruiting foreign-born U.S. graduates, the United States has strict limits on visas for highly skilled workers that often put them on waiting lists of many years." Kevin Sullivan in The Washington Post.

U.S. struggles to nab those who overstay visas. "The Senate is discussing an overhaul that would require the government to track foreigners who overstay their visas. The problem is the U.S. currently doesn't have a reliable system for doing this." Laura Meckler in The Wall Street Journal.

Video interlude: This hamster walker contraption is a smart re-application of a famous design.

4) The political opening for gun control

Obama is using his political freedom to talk issues -- like gun control. "More than he ever did in his first term, Obama is describing the country as he believes it should be, not the one it has been for much of the past decade. It is an inspirational technique of the community organizer and of the upstart national candidate he once was." Scott Wilson in The Washington Post.

Pro-gun lawmakers are open to limits on high-capacity magazines. "While influential lawmakers in both parties view a proposed ban on assault weapons as politically toxic, lawmakers seem increasingly open to a ban on high-capacity magazines...[E]vidence suggests that a ban on large magazines would have reduced the number of those killed in mass shootings." Jennifer Steinhauer in The New York Times.

Interview: Ta-Nehisi Coates talks to Harold Pollack about gun control and crime.

Study: Teen depression linked to higher property crime, but not violent crime. "In a new working paper for the National Bureau of Economic Research, D. Mark Anderson, Resul Cesur and Erdal Tekin examined data from the National Longitudinal Survey of Adolescent Health collected from students who were in grades 7 to 12 in the 1994-95 school year, then tracked them for the next 13 years...Researchers found that there was only one kind of crime that was linked statistically to adolescent depression: property crime." Suzy Khimm in The Washington Post.

Historical interlude: LBJ's love letters to Lady Bird.

5) The fight over Keystone

The risks Obama faces on Keystone. "President Obama faces a knotty decision in whether to approve the much-delayed Keystone oil pipeline: a choice between alienating environmental advocates who overwhelmingly supported his candidacy or causing a deep and perhaps lasting rift with Canada." John M. Broder, Clifford Krauss, and Ian Austen in The New York Times.

The green movement is making this a fight. "A crowd that organizers said numbered approximately 35,000 braved the cold on Sunday and marched to urge President Obama to reject the Keystone XL pipeline and to show leadership on other climate issues they called urgent." Steven Mufson in The Washington Post.

Meanwhile, gas prices rose sharply last month. "Prices at U.S. gasoline pumps have climbed for 32 consecutive days to a four-month high, as refinery closures cut output and higher crude prices raise costs. The national retail gasoline price has risen 43 cents, or 13%, to $3.73 a gallon since Jan. 17, according to the Automobile Association of America." Alison Snider and Paul Rekoff in The Wall Street Journal.

Vistas interlude: The "unreal Hawaii" blog.

Wonkblog Roundup

Big tobacco and anti-cancer advocates agree on something in the ACASarah Kliff.

Have seniors really paid for their Social Security and MedicareEzra Klein.

Why aren't more countries run by economistsBrad Plumer.

Teen depression linked only to property crime, study findsSuzy Khimm.

Why Washington will run the exchangesSarah Kliff.

Et Cetera

Why self-insurance could be a problem for the ACA. Robert Pear in The New York Times.

Infrastructure rhetoric is a bridge to nowhere. Jack Shafer in Reuters.

A cardiac conundrum. Alice Park in Harvard magazine.

Got tips, additions, or comments? E-mail me.

Wonkbook is produced with help from Michelle Williams.

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Sarah Kliff · February 18, 2013